Beijing Is Putting Final Touches on Plan Allowing Capital to Flow More Freely Into and Out of China

BEIJING—While Chinese leaders are putting final touches on a plan to allow capital to flow more freely into and out of China, the International Monetary Fund has warned that such changes could lead to a massive exodus of money from the country if not handled properly.

Officials say they are looking to what's known as capital-account liberalization as a way to give the Chinese more choice in financial investments and to use the market...